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Food & beverage · 14 June 2025 · 2 min read

Linear programming in the hotel bakery

Vikram Aditya Singh

🏨 HOTEL MANAGERS: Stop leaving money on the table! Linear Programming can revolutionize your resource allocation and boost profits by 15-25%. Here’s how using a simple bakery example 🧁

THE REAL CHALLENGE:
Your hotel bakery produces 2 cakes with limited resources:
• Chocolate Cake: $15 profit each (requires 3 cups flour, 2hrs baker time, 1hr oven)
• Vanilla Cake: $12 profit each (requires 2 cups flour, 1.5hrs baker time, 0.8hrs oven)

DAILY CONSTRAINTS:
• 60 cups flour available
• 30 hours baker time maximum
• 16 hours oven capacity
• Must produce at least 1 of each type (customer variety expectation)

THE LINEAR PROGRAMMING FORMULA:
🎯 OBJECTIVE: Maximize 15X + 12Y
(Where X = chocolate cakes, Y = vanilla cakes)

📊 CONSTRAINTS THAT LIMIT YOU:
• Flour limitation: 3X + 2Y ≤ 60
• Baker capacity: 2X + 1.5Y ≤ 30
• Oven capacity: 1X + 0.8Y ≤ 16
• Minimum variety: X ≥ 1, Y ≥ 1

STEP-BY-STEP SOLUTION:
We test corner point solutions (where constraints intersect):
• Option 1 (1,1): Profit = $27
• Option 2 (1,18): Profit = $231 ✅ OPTIMAL
• Option 3 (14,1): Profit = $222

SURPRISING RESULT: 1 chocolate + 18 vanilla = $231 maximum daily profit

COUNTERINTUITIVE INSIGHT:
Even though chocolate generates higher profit per unit ($15 vs $12), producing mostly vanilla cakes maximizes total profit! Why? Vanilla uses fewer resources per cake, allowing higher volume production within your constraints.

EXCEL IMPLEMENTATION (5 SIMPLE STEPS):

1. Data → Solver (install add-in if needed)
1. Set Objective: Total profit cell (select “Max”)
1. Variable Cells: Number of each cake type
1. Add Constraints: Resource limits + minimum production rules
1. Choose “Simplex LP” method → Solve

IMMEDIATE HOTEL APPLICATIONS:
🏨 Room Mix Optimization: Standard vs suite allocation based on housekeeping capacity
👥 Staff Scheduling: Full-time vs part-time ratios within budget constraints
🍽️ Menu Engineering: High-margin vs quick-prep dishes given kitchen limitations
🛏️ Housekeeping Routes: Maximize rooms cleaned within time constraints
💰 Revenue Management: Rate strategies considering demand and capacity limits
🚗 Parking Allocation: Guest vs valet spaces for maximum revenue

RESOURCE UTILIZATION ANALYSIS:
With optimal solution (1 chocolate, 18 vanilla):
• Flour usage: 39/60 cups (65% - room for growth)
• Baker time: 29/30 hours (97% - bottleneck identified!)
• Oven time: 15.4/16 hours (96% - near capacity)

This analysis reveals your baker time is the constraint limiting further profit growth - focus improvement efforts here!

KEY BUSINESS TAKEAWAY:
Linear Programming reveals non-obvious solutions. Your intuition might say “focus on high-profit items,” but math shows resource efficiency often trumps unit profitability. The “lower profit” option frequently maximizes total returns when resources are scarce.

First published on LinkedIn. Any workbook or deck the note mentions is attached to the original post.

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